What is Placement Agent?
A placement agent is an intermediary that helps fund managers raise capital from limited partners. They are paid a fee (typically 1–2% of capital raised) and leverage their LP relationships to accelerate fundraising.
Placement agents act as the distribution network for private funds. They introduce GPs to LPs they may not reach directly — pension funds, sovereign wealth funds, insurance companies, and family offices — and coach managers through the LP due diligence process.
Placement agents are common for emerging managers and international fundraises. Their fee is typically paid by the fund (and thus borne by all LPs) and is disclosed in the fund's private placement memorandum. Regulatory requirements govern placement agent practices, particularly for public pension funds.
Also known as: fund placement agent, fund distributor